If a bank offers to give you a free credit card, do not get greedy. First, know very well whether what the bank is saying is correct. This is because the bank or agent will talk a lot about all the discounts and reward points on the credit card, but they hardly tell you about the charges levied on them. A free credit card can cost you a lot if you do not know about its charges (credit card charges). The bank or agent does not even mention some charges. These hidden charges (Hidden charges on credit cards) secretly rob your pocket.
That’s why you should be careful while taking a credit card. What are the features of credit cards? Will they be useful for you, and will the credit card with zero annual fees be free? You should only take a free credit card after discovering things like that.
Annual Fee
Many banks and companies offer credit cards with zero annual fees, but first, understand whether they are free. Some banks also put a condition on zero annual fees. If you make purchases up to the limit set by the bank, then the bank does not charge you an annual fee. But, if you spend less than that limit, the bank imposes an annual charge.
Cash Advance Fee
Withdrawal of cash from a credit card is called a cash advance. Credit card companies allow users to withdraw cash from ATMs, but interest is high. There is no benefit of an interest-free credit period on cash advance. In this way, withdrawing cash from a credit card can be heavy on your pocket.
Cash Processing Fee
A cash processing fee may apply when you make your credit card payment in cash. No extra charges are levied on payment through net banking, check payment, and mobile banking.
Over limit charge
is the limit for spending on a credit card. If the customer spends more than his limit, an over-limit charge is levied. Due to this charge, the customer not only loses money but also affects the credit score.
Reward points are given in abundance on Reward Redemption Fee Credit Cards. Banks provide the facility to redeem credit card reward points. When you have accumulated reward points, you can redeem the same as per the facility provided by the bank. But many charges for redeeming back rewards.
Fuel Surcharge
The fuel surcharge is also applicable on many credit cards. This means that when you take fuel from a petrol pump using a credit card, you must pay some charges. It can range from 1% to 3% on the total transaction amount.
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